MARCH 29, 2024

Name: Musaib Mohammad Mir

Course: B.A.LL.B
Section: (A) , System ID:2020000445
Roll No: 200959061
Semester:VIII

Subject:Alternate Dispute Resolution

Assigned By: Dr. Razia Chauhan

TITLE:
Interim Measures By The Arbitral Tribunal
- Under The Arbitration And Conciliation
Act, 1996
1. Introduction
The Arbitration and Conciliation Act, 1996 is a comprehensive and detailed piece of
legislation, which governs about arbitration in India. It was enacted to consolidate and amend
the law relating to domestic arbitration, international commercial arbitration, enforcement of
foreign arbitral awards, and conciliation1. The Act in essence aligns to the Model Law on
International Commercial Arbitration adopted by the United Nations Commission on
International Trade Law (UNCITRAL)2.

2. Importance of understanding Section 17

Section 17 holds a central position within the Act as it empowers the arbitral tribunal to issue
interim measures. This power is critical in preserving the subject matter of the dispute,
ensuring parties comply with the process, and securing the effective implementation of the
arbitral award. Understanding Section 17 is, therefore, crucial for anyone involved in or
contemplating arbitration in India. A clear grasp of its provisions can provide valuable
insights into how disputes can be effectively managed and resolved through arbitration.

3. Background

As per the 1996 Act3, the arbitral tribunal under Section 17 may, upon request from either
party, grant temporary protection as it may deem appropriate about the subject matter dispute.
It was an improvement and revision of the 1940 Act 4, which did not grant the arbitral tribunal
the same authority as mentioned above. However it still suffered from drawbacks. So, in
order to maintain provision 17 on level with Section 9, where the Court has the authority to
provide interim reliefs, the 2015 Amendment made much-needed revisions to the provision
regarding the issuance of interim reliefs and the different types of reliefs that the arbitral
tribunal can issue. It also introduced that any order issued by the arbitral tribunal under this
section shall be deemed to be an order of the Court for all purposes and shall be enforceable
under the Code of Civil Procedure, 1908 in the same manner as if it were an order of the
Court.

1
Preamble of Arbitration and Conciliation Act, 1996
2
1985 With amendments as adopted in 2006
3
Arbitration and Conciliation Act, 1996
4
Arbitration and Conciliation Act, 1940
3.1. Section 17 as in Bare Act:
(1) A party may, during the arbitral proceedings or at any time after the making of the
arbitral award but before it is enforced in accordance with section 36, apply to the arbitral
tribunal —

i. for the appointment of a guardian for a minor or person of unsound mind for the
purposes of arbitral proceedings; or
ii. for an interim measure of protection in respect of any of the following matters,
namely —

(a) the preservation, interim custody or sale of any goods which are the subject-matter of the
arbitration agreement;

(b) securing the amount in dispute in the arbitration;

(c) the detention, preservation or inspection of any property or thing which is the subject-
matter of the dispute in arbitration, or as to which any question may arise therein and
authorising for any of the aforesaid purposes any person to enter upon any land or building
in the possession of any party, or authorising any samples to be taken, or any observation to
be made, or experiment to be tried, which may be necessary or expedient for the purpose of
obtaining full information or evidence;

(d) interim injunction or the appointment of a receiver;

(e) such other interim measure of protection as may appear to the arbitral tribunal to be just
and convenient,

and the arbitral tribunal shall have the same power for making orders, as the court has for
the purpose of, and in relation to, any proceedings before it.”

(2) Subject to any orders passed in an appeal under section 37, any order issued by the
arbitral tribunal under this section shall be deemed to be an order of the Court for all
purposes and shall be enforceable under the Code of Civil Procedure, 1908, in the same
manner as if it were an order of the Court.”
This section was amended5 by omitting “or at any time after the making of the arbitral award
but before it is enforced in accordance with Section 36” from subsection (1) which means
that all interim measures after the declaration of an award but prior to its enforcement will be
dealt under Section 9 by the concerned Court. This amendment has evidently succeeded in
clearing the inconsistency of which authority (Tribunal or Court) is to be approached once an
arbitral award has been passed by a tribunal and before it is enforced by one of the parties to
the Arbitration.

4. Explanation of the provisions stated in Section 17

The arbitral tribunal has the same authority to make temporary protection orders as a court 6
under Section 17 of the Act. These can involve conserving assets, keeping evidence that
could be important in resolving the dispute, acting to prevent injury or prejudice to the
arbitration process itself, or maintaining or restoring the status quo while the issue is being
resolved. Additionally, if the other party disobeys the tribunal's directives, a party may
petition to the court for enforcement, according to this clause.

Illustration: Let's consider a hypothetical scenario. Suppose there's a contract between two
parties, A and B, to construct a building. Disputes arise during construction, and both parties
agree to resolve their issues through arbitration. If Party A fears that Party B might sell off
the construction materials before the dispute is resolved, they can ask the arbitral tribunal to
order Party B to refrain from selling. This is an application of the provision under Section 17.

5. Case studies showcasing these implications

In India, the Supreme Court in R. McDill & Co. (P) Ltd v. Gouri Shanker 7 held that the
parties to arbitration have recourse to all the interim measures available under the Civil
Procedure Code of 1908. Later in M/s. Sundaram Finance Ltd. V. M/s. NEPC India Ltd8, the
Supreme Court considered the question whether a party can approach a court for injunction
even before arbitration process has actually started and answered in the affirmative. This
Court rejected the reasoning’s given by the lower Court and held that interim measures of

5
Amendment Act, 2019
6
Sec-9 of Arbitration and Conciliation Act,1996
7
R. McDill & Co. (P) Ltd v. Gouri Shanker, (1998) 2 SCC 548.
8
M/s. Sundaram Finance ltd., v. M/s. NEPC India Ltd., AIR 1999 Supreme Court 565
protection can be granted even prior to the initiation of arbitration proceedings 9. The court
referred to the Arbitration Act of 1940, the UNCITRAL Model Law, Arbitration Act of 1996
of England and two English cases viz. The Channel Tunnel Case and France Manche S.A. v.
Balfour Beatty Constructions Ltd10. The Supreme Court in its decision points out the relevant
sections of the Arbitration Act of 1940 that permit interim measures during arbitration 11. The
Delhi High Court followed this decision in M/s. Buddha Films Pvt. Ltd. V. Prasar Bharati 12.
Even though it finally rejected the petition for interim injunction on the merits of the case, it
held that a petition for interim relief is maintainable pending arbitration proceedings97. But
some recent decisions, including the latest in that line by Delhi High Court has raised
concerns among the arbitration practitioners in India.

In the case of Sundaram Finance Ltd. vs NEPC India Ltd13 the Supreme Court interpreted the
scope of Section 17 and emphasized the arbitral tribunal's role in maintaining the balance of
convenience and ensuring parties do not suffer irreparable loss pending arbitration. This
landmark judgment underscored the importance and broad scope of Section 17.

Another case that showcases the impact of Section 17 is Avitel Post Studioz Limited & Ors vs
HSBC PI Holdings (Mauritius) Limited14. Here, the Supreme Court ruled that the power
under Section 17 includes the power to grant unconditional stay of a money decree. This
judgment significantly expanded the power of the arbitral tribunal under Section 17.

6. Comparison with similar laws in other countries

When compared to similar laws in other countries, Section 17 stands its ground. For instance,
the United Kingdom15 allows the arbitral tribunal to make provisional orders, akin to interim
measures. However, unlike Section 17, it does not empower the arbitral tribunal to enforce its
orders. Similarly, the United States 16 does not explicitly provide for interim measures by the

9
it follows that the High Court erred in coming to the conclusion that the Trial Court had no jurisdiction in
entertaining the application under Sect. 9 because arbitration proceedings had not been initiated by the
appellant.”
10
[1992] EWCA Civ J0122-3
11
“The position under the Arbitration Act, 1940 was that a party could commence proceedings in Court by
moving an application under Sect. 20 for appointment of an arbitrator and simultaneously it could move an
application for interim relief under the Second Schedule read with Sect. 41(b) of the 1940 Act.”
12
AIR 2001 Delhi 241
13
AIR 1999 SUPREME COURT 565, 1999 AIR SCW 225,
14
AIR 1999 SUPREME COURT 565, 1999 AIR SCW 225,
15
UK's Arbitration Act 1996, Section 39,
16
The Federal Arbitration Act is a federal statute, codified at 9 U.S.C. §§ 1-16,
arbitral tribunal. Thus, Section 17 provides more comprehensive power to the arbitral tribunal
than its counterparts in some other jurisdictions.

7. Do Section 9 and Section 17 hold equal powers while making the

Orders?

The Arbitration and Conciliation (Amendment) Act, 2015 gave the arbitral tribunal the same
authority as the court; however, they are not allowed to overrule the court and issue any
orders that a court would normally be able to issue. This occurred in Pradeep K.N. vs. The
Station House Officerix17, where the arbitral tribunal issued an order under Section 17 of the
statute for the temporary seizure of a vehicle. The court determined that only a civil court
may issue such an order. Conferring the power of a civil court to an arbitral tribunal for
passing an interim order doesn't mean that the tribunal is conferred with the power of
enforcement and can make any order.

8. Conclusion

In conclusion, Section 17 plays a pivotal role in the Arbitration and Conciliation Act, 1996. It
fortifies the arbitral process by equipping the arbitral tribunal with essential powers to issue
interim measures. This power ensures the preservation of the subject matter, compliance with
the arbitration process, and execution of the arbitral award. By doing so, Section 17 ensures
the robustness, efficiency, and effectiveness of arbitration in India. While Section 17 provides
substantial power to the arbitral tribunal, there is always room for improvement. Firstly, more
clarity could be provided on what constitutes 'interim measures' to prevent misuse of this
provision. Secondly, mechanisms could be put in place to ensure faster enforcement of the
orders issued under Section 17. Lastly, there could be guidelines established for the arbitral
tribunal to follow when issuing interim measures, ensuring uniformity and avoiding arbitrary
decision-making.

9. References

17
WP(C).No. 38725 of 2015 (M)
a. NGC Network India Pvt. Ltd vs Orange Fish Entertainment Pvt Ltd [2018(5) ArbiLR
247]
b. MD Army Welfare Organisation vs Sumangal Services Pvt. Ltd. [AIR 2004 SC 1344]
c. Civil Appeal No.8720 Of 2017 (Arising out of S.L.P.(Civil) No.3576 of 2016)(2001) 8
SCC 397
d. https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/uncitral/en/19-
09955_e_ebook.pdf
e. V. Giri, Interim Measures Available in Arbitration and Conciliation Act, 1996, ICA
Arbitration Quarterly,
f. Vol. XXXXX, No.3, Oct-Dec 2001, available at
http://www.ficci.com/icanet/ICA-Oct/OCT6.htm
g. UNCITRAL Model Law, available at http://www.uncitral.org
h. UNCITRAL Arbitration Rules, available at http://www.uncitral.org